Senate Democrats will push a one-year tax cut proposal for individual Americans earning $200,000 or less annually, setting the stage for a showdown in coming weeks with Republicans over extending the Bush tax cuts, according to a new plan circulating on Capitol Hill.

Couples with a combined $250,000 income will also be covered by the Democratic proposal.

The cost of the proposal would be roughly $272 billion for one year, Democratic aides said.

Senate Majority Leader Harry Reid (D-Nev.) wants to vote on the proposal as early as the week of July 23, the aides added.

Speaker John Boehner (R-Ohio) and House Republicans are pushing for a full extension for the Bush tax cuts for all income levels. But Reid and President Barack Obama are pushing for tax cuts for those U.S. families making $250,000 or less. The Bush tax cuts, originally enacted in 2001 and 2003 — and extended 2010 — will expire on Dec. 31.

Sens. James Webb (D-Va.) and Joe Lieberman (I-Conn.) have already publicly stated that they will not support the Obama-Democratic leadership position.

Democratic sources say that two embattled Democratic incumbents, Jon Tester (Mont.) and Claire McCaskill (Mo.), will likely back the plan. Another concern for Reid will be Sens. Maria Cantwell (D-Wash.) and Mark Warner (D-Va.). With only 53 Democrats — and Reid calling for a straight majority vote for any tax proposal — Democratic leaders cannot afford to lose any support.

The 20-page draft Democratic proposal obtained by POLITICO includes these provisions: a 20 percent capital gains rate on those earning more than $200,000, couples over $250,000; a 20 percent dividend rate on those earning more than $200,000, couples over $250,000; estate taxes would apply to estates worth more than $3.5 million with a maximum rate up to 45 percent; extensions of the American Opportunity Tax Credit for college standouts, as well as an expanded child tax credit and Earned Income Tax Credit for poorer Americans; and a one-year patch for the alternative minimum tax.

The legislation also states “that the budgetary effects will not be entered on the PAYGO scorecard,” meaning its impact on the deficit will not derail the legislation. Tax experts said that Reid and other Democratic leaders fear that going for an even more costly bill could cost them support.